On Tuesday, the deputy prime minister warned Sir Salamo and two other judges they had to resign within 24 hours or they would be arrested and charged with sedition.

That followed the Supreme Court's decision on Monday that upheld an earlier ruling ordering Sir Michael Somare be reinstated as prime minister.

On Thursday afternoon Mr Namah carried through on his threats.

Sir Salamo believes Mr Namah's actions in directing police to arrest him shows the police are not independent and that they are not acting under the command of the police commissioner, but directly under the command of the deputy prime minister.

Outside court, Mr Namah denied his actions set a dangerous precedent for the country.

"I gave him 24 hours. Time has run out. That is it," he said.

For most of the last year the government of Peter O'Neill has made a number of unsuccessful attempts at removing Sir Salamo from his role as chief justice.

They came to a head in December last year when the Supreme Court held down its first decision, finding that Peter O'Neill's ascent to the prime ministership was unconstitutional and it ordered that Sir Michael Somare be reinstated as prime minister.

They've come to a head again this week. On Monday the Supreme Court again upheld that earlier decision and said that those orders made back in December need to be followed by all government agencies.

But there was some controversy surrounding that decision. Two of the five judges withdrew just as the decision was being handed down. That was because of an email, an inter-court email that was leaked to the local media.

In it, one of the judges referred to the O'Neill government as an illegal regime before this latest case had even got underway. So Peter O'Neill and his supporters have said this decision, latest decision is tainted by bias and they're not going to recognise it and that has now escalated to this charge of sedition being laid against Sir Salamo.

PNG correspondent Liam Fox

Another Supreme Court judge, Nicholas Kirriwom, was also at the courthouse and said he was distressed by the day's events.

"It's a very sad day for Papua New Guinea, for democracy, for the constitution, but that doesn't mean that we are going to submit that easily," he said.

"We will stand up and fight for the constitution in this country."

Australian Prime Minister Julia Gillard says she has spoken with Mr O'Neill to express her concern about the latest developments.

A spokesman for Ms Gillard says Mr O'Neill agreed it was important that the current situation does not detract from the good progress being made towards this year's election.

Foreign Minister Bob Carr has also contacted the PNG government and urged it not to take action against Sir Salamo.

He says the PNG government should ignore any decisions they resent from the judiciary and press ahead with the elections.

"I'd just caution that action against the chief justice is entirely unnecessary," he said.

"There's a course for an election, the writs have been issued, the date is set. The election is the thing that's important, the election confers legitimacy and authority on the government."

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